Fitch: Ratings of Brazilian Subsidiaries of French Banks Not Affected by Downgrade of Parents' IDRs

  Fitch: Ratings of Brazilian Subsidiaries of French Banks Not Affected by
  Downgrade of Parents' IDRs

Business Wire

RIO DE JANEIRO -- July 22, 2013

Fitch Ratings notes that the international and national ratings of Banco
Societe Generale Brasil S.A. (SGBr), Banco Cacique S.A. (Cacique) and Banco
Pecunia S.A. (Pecunia), and the national ratings of Banco Credit Agricole
Brasil S.A. (BCAB), are not affected by the downgrade of their parents' Issuer
Default Ratings (IDRs) on July 17, 2013, which, in turn, followed France's
sovereign downgrade to 'AA+'/Outlook Stable from 'AAA'/Outlook Negative on
July 12, 2013.

The ratings of all four banks operating in Brazil are based on support from
their ultimate parents. SGBr and BCAB are fully owned by Societe Generale (SG)
and Credit Agricole Corporate and Investment Bank (CACIB), respectively. Fitch
classifies both subsidiaries as 'strategically important' for their respective
parents. Cacique and Pecunia are fully owned by SGBr. Fitch considers these
two banks as subsidiaries of 'limited importance' for SG.

The long-term foreign currency IDRs of SG's subsidiaries are constrained by
Brazil's country ceiling ('BBB+'), while their long-term local currency IDRs
are two notches above Brazil's long-term local currency rating, due the
expected support from its parent. This is normally the largest uplift applied
by Fitch to banks in any given jurisdiction. After SG's downgrade, the
long-term foreign currency IDRs of SG's subsidiaries remain constrained by the
country ceiling, while their long-term local currency IDRs are just one notch
below the IDR of their parent. This is consistent with Fitch's notching policy
for subsidiaries with the conditions and characteristics of these three banks
(for more information see the rating action commentary 'Fitch Affirms Ratings
of Banco Societe Generale Brasil, Banco Cacique and Banco Pecunia', published
on March 21, 2013, available at 'www.fitchratings.com'). The national scale
ratings consider the still high ability and propensity of SG to provide
support to its subsidiaries in Brazil, as SG is rated three notches above
Brazil's sovereign rating. Further downgrades on SG's ratings would affect the
local currency IDRs of its subsidiaries in Brazil, in order to preserve the
one notch of difference with their parent, while the foreign currency IDRs of
the Brazilian subsidiaries would be affected by a multi-notch downgrade of SG.

BCAB's national ratings similarly benefit from the expected support by its
parent CACIB, should it be required. CACIB's current long-term IDR remains
three notches above Brazil's sovereign rating, therefore, the national rating
of BCAB would only be affected by a multi-notch downgrade of CACIB.

For more information on the downgrade of large French banks, please refer to
the rating action commentary 'Fitch Downgrades Major French Banks' published
on July 17, 2013, available at 'www.fitchratings.com'.

The following ratings of the Brazilian banks remain unchanged:

SGBr:

--Foreign Currency Long-term IDR 'BBB+', Outlook Stable;

--Local Currency Long-term IDR 'A-', Outlook Stable;

--Foreign Currency Short-term IDR 'F2';

--Local Currency Short-term IDR 'F1';

--Support Rating '2';

--National Long-term Rating 'AAA(bra)', Outlook Stable;

--National Short-term Rating 'F1+(bra)'.

Cacique:

--Foreign Currency Long-term IDR 'BBB+', Outlook Stable;

--Local Currency Long-term IDR 'A-', Outlook Stable;

--Foreign Currency Short-term IDR 'F2';

--Local Currency Short-term IDR 'F1';

--Support Rating '2';

--National Long-term Rating 'AAA(bra)', Outlook Stable;

--National Short-term Rating 'F1+(bra)'.

Pecunia:

--Foreign Currency Long-term IDR 'BBB+', Outlook Stable;

--Local Currency Long-term IDR 'A-', Outlook Stable;

--Foreign Currency Short-term IDR 'F2';

--Local Currency Short-term IDR 'F1';

--Support Rating '2';

--National Long-term Rating 'AAA(bra)', Outlook Stable;

--National Short-term Rating 'F1+(bra)'.

BCAB:

--National Long-term Rating 'AAA(bra)', Outlook Stable;

--National Short-term Rating 'F1+(bra)'.

Additional information is available at 'www.fitchratings.com'.

Applicable Criteria and Related Research:

--'National Ratings Criteria' (Jan. 19, 2011);

--'Rating FI Subsidiaries and Holding Companies' (Aug. 10, 2012);

--'Global Financial Institutions Rating Criteria' (Aug. 15, 2012);

--'Fitch Affirms Banco Credit Agricole Brasil S.A.'s National Ratings' (Aug.
17, 2012);

--'Fitch Affirms Ratings of Banco Societe Generale Brasil, Banco Cacique and
Banco Pecunia' (March 21, 2013);

--'Fitch Downgrades Major French Banks' (July 17, 2013).

Applicable Criteria and Related Research:

National Ratings Criteria

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=595885

Rating FI Subsidiaries and Holding Companies

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=679209

Global Financial Institutions Rating Criteria

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=686181

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Contact:

Fitch Ratings
Primary Analyst:
Esin Celasun
Associate Director
+55-21-4503-2626
Fitch Ratings Brasil Ltda.,
Praca XV de Novembro, 20 - 401 B,
Rio de Janeiro, RJ, Brazil
or
Secondary analyst:
Eduardo Ribas
Associate Director
+55-21-4504-2213
or
Media Relations:
Jaqueline Carvalho, +55 21 4503 2623 (Rio de Janeiro)
jaqueline.carvalho@fitchratings.com
Elizabeth Fogerty, +1-212-908-0526 (New York)
elizabeth.fogerty@fitchratings.com
 
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